Initial readings indicate that the site could hold two billion barrels of new reserves. But it's still early. Like with the Bakken formation (which was also originally projected to contain two billion barrels of oil), that number could end up being much higher.

The Alaska North Slop oil is going to be cheaper to produce, too.

There are two reasons why: First of all, drilling infrastructure already exists in the region. And, more importantly, the type of rock in the Alaskan shale contains more limestone, which makes it softer. This should significantly reduce energy costs associated with extracting and processing the oil than you'd see with other formations.

Now, I can't say too much more about it at this time. A major oil drilling company is currently examining samples from the drill site. And I should get solid results in a few weeks, which I'll share with you then.

What I can say, though, is that the company is already in early-stage negotiations to stake its claim through some smaller explorers that already have a significant presence in the area.

Duncan said the Shublik shale, which he called the "motherlode", could eventually rival some of the best onshore plays in the US such as the Bakken and the Eagle Ford.

Hosmer also reaffirmed Royale's plans to develop about 100,000 acres of land adjacent to Great Bear's holdings.

Royale investors appeared giddy at the news, as the stock soared on the Nasdaq. It rose as high as $5.23 per share in heavy trade, a 61% increase over Wednesday's $3.25 close. It eventually settled at $4.32.

Last December, Royale took home the biggest prize in the North Slope lease sale, splashing about $2.7 million for almost 100,000 acres in what is considered the prospective trend for liquids-rich shales.

Given the test results from its Alcor No. 1 well, Duncan said his permitting team is now working with the state on a change in plan, to potentially proceed with long-term production testing of the wells, in hopes of accelerating the company's shale oil development program.

There is still much work to do, "but we're working hard to bring the decision forward, for ourselves and for the state of Alaska, for regional development by as much as a year," Duncan said.

That would move a decision on whether to proceed with a full-scale shale oil development from 2014 to the middle of 2013.

Great Bear is drilling its second test well, the Merak No. 1, next to the North Slope Haul Road.

40 billion barrels of conventional oil that could be cleanly unlocked with new drilling methods